Justice Department launches formal investigation into Google's book settlement [UPDATED]
"The United States has reviewed public comments expressing concern that aspects of the settlement agreement may violate the Sherman Act," wrote William F. Cavanaugh, the Justice Department's deputy assistant attorney general, in a letter to Federal District Court Judge Denny Chin, the judge overseeing Google's settlement.
The letter goes on to say that although the department has "no conclusions as to the merit of those concerns," it did see issues that "warranted further inquiry."
Google emphasized that it is cooperating with the Justice Department investigation and maintains that the settlement would be good for consumers.
"The Department of Justice and several state attorneys general have contacted us to learn more about the impact of the settlement, and we are happy to answer their questions," said Google Spokesman Gabriel Stricker. "It’s important to note that this agreement is non-exclusive and if approved by the court, stands to expand access to millions of books in the U.S."
The settlement reached last fall between Google and the Authors Guild and the Assn. of American Publishers stemmed from the search giant's project to scan millions of books and create a searchable digital library of works that would potentially become the basis of a digital book market.
Paul Aiken, executive director of The Authors Guild, downplayed the significance of today's move by the Department of Justice. "It appears to be just an official acknowledgement to the court of an investigation that we have known about for weeks," Aiken said. "It’s no indication that anything has changed."
Reports surfaced in late April that Justice Department regulators had questioned Google and several advocacy groups that have spoken out against the settlement. Weeks later, publishers and The Authors Guild also confirmed receiving civil subpeonas from Justice seeking more information on the settlement. But until today, the Justice Department has not said whether those inquiries constituted a formal antitrust investigation.
In recent months, a number of parties have objected to the agreement, including a group of libraries, a consumer rights group and the Internet Archive, a nonprofit organization that seeks to digitize public domain books and make them freely available online to all readers. Many of the objections involve concerns that Google would create a monopoly for millions of "orphan" books whose rights holders cannot be located.
The Justice Department did not immediately return calls for comment.
Updated 4:25 p.m.: This post has been updated to include comments from Google and the Author's Guild.
-- Alex Pham and David Sarno